Fiat Chrysler and Renault are conducting merger talks

Fiat Chrysler and Renault are considering a merger with each other, as the two companies have been negotiating for some time now. Renault has agreed to delay its merger plans with Japan's Nissan company if FCA approval is achieved. Discussions between the two sides on a merger of forces first appeared a week ago. Such a deal would help companies pool their resources in an industry under the pressure of declining sales and technological upheavals.

The two companies are expected to officially announce their venture this week. Companies want to work together in several areas, including communications, production platforms and electric cars. A full merger is being considered - structuring and equal, according to people familiar with the case.

However, Renault's intention to merge with Nissan may not be thrown away so easily. If that happens, the cold relationship between the French and the Japanese partner will cool down. They were kindled after the arrest of former Alliance leader Carlos Ghosn eight months ago.

Delaying this merger would also give the two companies the opportunity to focus on their own affairs, rather than distracting themselves with domestic policy and plans to change the Alliance.

Negotiations between Renault and FCA are currently under way and may not result in a positive outcome. However, Renault will convene a board of directors immediately after the official announcement of the plans of the French company with Nissan.

Source: The Financial Times

Photo: Flickr

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